Home Prices Rise to New Heights in New York

Luxury condos, especially in Manhattan, drive citywide growth

By Andrea López CruzadoOriginally published on July 12, 2016|Mansion Global|

Luxury condo sales in Manhattan drove average home prices in the rest of New York City to an all-time high in the second quarter, according to a new report released Tuesday.

The average sales price of a home in New York City increased by 10% to $1.018 million in the second quarter when compared with the same period in 2015, the Real Estate Board of New York (REBNY) found in its latest sales report. The average price is the highest on record since REBNY started tracking home sales data in 2006.

Manhattan recorded the highest increase of all the boroughs: 20%, to $2.118 million.

REBNY attributed the pent-up activity mainly to the condo segment, where average prices citywide went up 23% from the second quarter of 2015 to $1.945 million. The growth was led, once again, by Manhattan, where the average sales price for a condominium was $2.843 million, an increase of 21% from the second quarter in 2015.

“While high-end Manhattan sales drove up the average sales price, the continuous demand for middle-market homes is pulling the median sales price of homes higher as well,” said John Banks, REBNY’s president.

The Midtown East neighborhood was particularly booming. The average sales price of a condo unit in that area nearly doubled from the second quarter of last year to $4.949 million, and the total number of sales went up by 27% to 127. Much of this activity was attributed to sales at 432 Park Avenue, the tallest residential building in the Western Hemisphere. There were 19 sales at the tower averaging a price of $19.3 million.

Another neighborhood recording stellar growth was Williamsburg, Brooklyn, where condo sales rose to 120 transactions, a 43% increase compared to the second quarter of 2015. Still, average sales prices went down 13% to $937,000.

Mr. Banks said that sales took a hit from the increase in median sales prices. There were a total of 11,031 transactions in New York City overall in the second quarter, a 2% decline from the year before. Still, the total monetary value of completed transactions was $11.2 billion, up 8% from last year.